United States District Court, N.D. Indiana, Hammond Division
OPINION AND ORDER
P. RODOVICH, UNITED STATES MAGISTRATE JUDGE.
matter is before the court on the Motion to Dismiss the First
Amended Complaint [DE 122] filed by the defendant, Indiana
Harbor Belt Railroad, on February 19, 2019, and the Joint
Motion to Dismiss Amended Complaint [DE 124] filed by the
defendants, Norfolk Southern Corporation, CSX Corporation,
Terry Evans, John Hart, Mike Pendergrass, and Tom Werner, on
February 20, 2019. For the following reasons, the Motion to
Dismiss the First Amended Complaint [DE 122] is
GRANTED, and the Joint Motion to Dismiss
Amended Complaint [DE 124] is GRANTED.
plaintiff, Soo Line Railroad Company d/b/a Canadian Pacific
(CP), initiated this matter against the defendants,
Consolidated Rail Corporation (Conrail), Norfolk Southern
Railway Company (NSR), and CSX Transportation, Inc. (CSXT)
(landlord defendants), on March 6, 2017. The Complaint also
named Indiana Harbor Belt Railroad Company (IHB) as a
defendant. IHB was jointly owned by CP and Conrail, and
operated on property owned by Conrail, CSXT, and NSR. CP has
indicated that it does not seek relief directly against IHB,
a nominal defendant, rather it has named IHB in this action
because it may be considered an indispensable party.
2, 2017, the landlord defendants moved to dismiss the
Complaint as preempted by federal law. CP filed an Amended
Complaint on June 13, 2017, rendering moot the landlord
defendants' motion to dismiss. The Amended Complaint
added ten additional defendants. The additional defendants
included the corporate parents of the landlord defendants,
Norfolk Southern Corporation and CSX Corporation (parent
defendants), and members of IHB's board of directors,
Terry Evans, John Hart, Mike Pendergrass, and Tom Werner
response to the Amended Complaint, the landlord defendants
renewed their motion to dismiss. The court entered an Opinion
and Order on March 29, 2018 granting in part the landlord
defendants' motion to dismiss. The court found that
CP's claims were preempted by the Interstate Commerce
Commission Termination Act (ICCTA), 49 U.S.C. §§
10101, et seq. The court held that CP's claims
would require the court to adjudicate the fairness of rental
rates and impermissibly interfere with the Surface
Transportation Board's (STB) exclusive jurisdiction over
regulated trackage rights transactions. Furthermore, the
court ordered supplemental briefing on CP's request for
Operating and Maintenance (O&M) expenses. In an Opinion
and Order entered on October 24, 2018, the court dismissed
all of CP's claims against the landlord defendants.
not further amended the Amended Complaint. Thus, the Amended
Complaint asserts the same claims and requests for relief
against the parent defendants and the individual defendants
as those that previously were dismissed by the court on March
29, 2018. Therefore, the parent defendants and the individual
defendants have moved to dismiss the Amended Complaint
pursuant to Federal Rule of Civil Procedure 12(b)(6). IHB
also filed a motion to dismiss the Amended Complaint on
February 19, 2019. CP filed a response in opposition on March
20, 2019, and the parent defendants and individual defendants
filed a reply on April 8, 2019.
Rule of Civil Procedure 12(b)(6) allows for a
complaint to be dismissed if it fails to “state a claim
upon which relief can be granted.” Allegations other
than those of fraud and mistake are governed by the pleading
standard outlined in Federal Rule of Civil Procedure 8(a)(2),
which requires a “short and plain statement” to
show that a pleader is entitled to relief. See Cincinnati
Life Ins. Co. v. Beyrer, 722 F.3d 939, 946 (7th Cir.
2013). The Supreme Court clarified its interpretation of the
Rule 8(a)(2) pleading standard in a decision issued in May
2009. While Rule 8(a)(2) does not require the pleading of
detailed allegations, it nevertheless demands something more
“than an un-adorned, the-defendant-unlawfully-harmed-me
accusation.” Ashcroft v. Iqbal, 556 U.S. 662,
678, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009). In order
to survive a Rule 12(b)(6) motion, a complaint “must
contain sufficient factual matter, accepted as true, to
‘state a claim to relief that is plausible on its
face.'” Iqbal, 556 U.S. at 678 (quoting
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570,
127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)); Cincinnati Life
Ins., 722 F.3d at 946 (“The primary purpose of
[Fed.R.Civ.P. 8 and 10(b)] is to give defendants fair notice
of the claims against them and the grounds supporting the
claims.”) (quoting Stanard v. Nygren, 658 F.3d
792, 797 (7th Cir. 2011)); Peele v. Clifford Burch,
722 F.3d 956, 959 (7th Cir. 2013) (explaining that one
sentence of facts combined with boilerplate language did not
satisfy the requirements of Rule 8); Joren v.
Napolitano, 633 F.3d. 1144, 1146 (7th Cir. 2011). This
pleading standard applies to all civil matters.
Iqbal, 556 U.S. at 684.
March 29, 2018, the court granted in part and denied in part
the landlord defendants' motion to dismiss. The court
concluded that CP's claim for breach of fiduciary duties
against the landlord defendants was preempted by §§
10501(b) and 11312(a) of the ICCTA. That statute vests the
STB with exclusive jurisdiction and authority over rail
transportation, including trackage rights agreements.
49 U.S.C. §§ 10501(b), 11321(a).
The court determined that CP's state-law claim and its
requested relief required the court to adjudicate the
fairness of the rental rates, and therefore interfered with
the STB's exclusive jurisdiction. Moreover, the court
determined that by granting the relief requested by CP it
would ignore § 11321's clear exemption language or
modify the terms of the STB-exempt agreement.
court also dismissed Count II (aiding and abetting breach of
fiduciary duties), Count III (civil conspiracy to breach
fiduciary duties), and Count IV (vicarious liability for
breach of fiduciary duties) because without a viable
underlying tort, Counts II-IV were not recoverable.
Additionally, CP requested that the court award IHB the
O&M expenses that Conrail was obligated to pay pursuant
to the 1906 Agreement. The court found that the parties
proceeded in a cursory fashion on the O&M issue and
allowed them to file supplemental briefs. On October 24,
2018, after considering the supplemental briefs, the court
entered an Opinion and Order dismissing CP's request for
O&M expenses and granting the motion to dismiss.
Accordingly, CP's claims against the landlord defendants
were dismissed in their entirety.
parent defendants and the individual defendants have filed
the instant motion requesting the court to dismiss the
Amended Complaint. The parent defendants and the individual
defendants have indicated that the Amended Complaint has not
been further amended and asserts the same claims and seeks
the same relief against them as previously dismissed by the
court against the landlord defendants. Therefore, they have
argued that the March 29, 2018 Opinion and Order should apply
to them with equal weight. In the response in opposition, CP
did not argue that the court's reasoning should be
applied with less force to the parent defendants and the
individual defendants than the landlord defendants. Rather,
CP simply rehashed the arguments that the court previously
ruled on. Accordingly, the ICCTA preempts CP's claims,
which include the claims against the parent defendants and
the individual defendants.
also has filed a motion requesting the court to dismiss the
Amended Complaint pursuant to Federal Rule of Civil Procedure
12(b)(1) for lack of subject matter jurisdiction. “A
case becomes moot, and the federal courts lose subject matter
jurisdiction, when a justiciable controversy ceases to exist
between the parties.” Aslin v. Financial Indus.
Regulatory Auth., Inc., 704 F.3d 475, 477 (7th Cir.
2013). “A dismissal on mootness grounds is a dismissal
for lack of jurisdiction.” Bernstein v.
Bankert, 733 F.3d 190, 224 (7th Cir. 2013). IHB contends
that all the matters in the Amended Complaint have been
adjudicated, and therefore, this case is moot. CP argued that
a justiciable controversy exists because the court has not
adjudicated the claims against the parent defendants and the
individual defendants. However, as discussed above, the court
has dismissed those claims. Accordingly, the court lacks
subject matter jurisdiction and dismisses the Amended
Complaint against IHB as moot, pursuant to Rule 12(b)(1).
on the foregoing reasons, the Motion to Dismiss the First
Amended Complaint [DE 122] is GRANTED, and
the Joint Motion to Dismiss Amended Complaint [DE 124] is
GRANTED. The court ...